But that set off speculation among investors about an interest rate hike later this year, and that in turn set off worries about global growth. But on Friday, at the Fed’s annual gathering for global central bankers in Jackson Hole, Wyoming, Fed Chair Janet Yellen gave one of the clearest indications that a rate hike was probably round the corner.
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“The Treasury market is taking no direction [from] the data and in fact has bounced this morning following Friday’s sharp selloff”, said Ian Lyngen, an independent interest-rate strategist, in an email.
Wall Street, meanwhile, took the rate signals from the Fed as a sign of confidence in the USA economy, supported by solid consumer spending data for July on Monday that pointed to strong U.S. economic growth in the third quarter. Fischer said Friday’s nonfarm payrolls report for August was likely to be key to the decision over a hike in the near term.
Investors said Friday’s U.S.jobs report was now in strong focus for any further clues about whether the next USA rate hike could come as early as September.
After Monday’s sell-off across most markets, fuelled by the prospect of higher United States borrowing costs, investors returned to buying, buoyed by a rally on Wall Street as another batch of data indicated improvement in the world’s top economy. The euro fell to $1.1206 from $1.1289. London was closed for a holiday. Stocks in South Korea and Australia both rose around 0.6 per cent.
Stada fell 0.3 percent after activist investor Active Ownership Capital succeeded in persuading shareholders of Stada over the weekend to remove the company’s supervisory board chairman in a voting marathon, but failed to install its own candidate.
WALL STREET: The Dow Jones industrial average rose 107.59 points, or 0.6 percent, to 18,502.99.
“We’re still cautious about the scope for a September rate hike, but it is increasingly becoming a close call”, said Martin van Vliet, senior rates strategist at ING. Among the releases to be scrutinized will be US consumer confidence for August, due on Tuesday, while productivity, manufacturing and construction figures are due on Thursday.
The dollar bought 101.94 Japanese yen, higher than 101.87 yen in the previous session.
But lower oil prices on the resource heavy TSX pushed down the energy group 0.3 per cent, Crude prices were weighed down Monnday by higher output from Middle Eastern producers and a stronger US dollar, in which the commodity is priced.
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The stronger dollar weighed on gold.
